In this post Adelaide Law School’s Gabrielle Appleby explains the High Court’s decision in Williams v Commonwealth  HCA 23 (19 June 2014) and the need for an immediate response from the Commonwealth. This article was originally published on The Conversation.
The High Court has again put the future of the federal government’s school chaplaincy program in jeopardy, confirming its 2012 decision that the Commonwealth’s spending programs must be supported by valid federal legislation.
In a case brought again by Toowoomba man Ron Williams, the High Court insisted federal spending programs respect the constitutional division of powers between the Commonwealth and the states.
Background to school chaplaincy
In its May budget, the Abbott government allocated an additional A$245 million of funding for the National School Chaplaincy Program. It also announced that the program would be (once again) restricted to the funding of religious chaplains in schools, reversing the expansion of the funding in 2008 by the Labor government to secular student welfare workers.
Despite the ideological divide over the provision of sectarian or secular workers, the program has received strong bipartisan support since its inception. It exemplifies a larger trend for the Commonwealth to extend its funding programs into areas traditionally viewed as within the states’ competence, such as education, health and local government.
In 2012, the future of the program was briefly uncertain when the High Court accepted a constitutional challenge by Toowoomba man Ron Williams. However, the Commonwealth passed legislation to put the program quickly back on its feet.
The government’s initial response
In response to the 2012 Williams decision, the then-Gillard government introduced Section 32B into the Financial Management and Accountability Act 1997. This section gave the Commonwealth the power to vary or administer funding arrangements and grants that were specified in the regulations.
The parliament also inserted a schedule into the Financial Management and Accountability Regulations 1997 that listed over 400 funding programs, including the National School Chaplaincy and Student Welfare Program. Future programs could be inserted into the schedule by the government itself through amending regulations.
The primary constitutional difficulty with the remedial legislation was that many of the programs authorised in the regulations had little, or dubious, connections to federal legislative power, including a number of grants to schools, higher education and research institutions, local government and, of course, the chaplaincy program itself.
There was a second difficulty with the legislation. It delegated to the government the power to make regulations authorising the government’s expenditure. This delegation appeared antithetical to the principle of parliamentary scrutiny emphasised in the majority judgment in Williams’ first challenge.
Then-federal attorney-general Nicola Roxon provided a weak explanation as to why the Commonwealth thought its remedial legislation was valid based on a strained interpretation of the High Court’s decision. She explained that the judgment was unclear, that it was:
… split with some judgments suggesting a greater prospect that the [High] Court may in the future find that Commonwealth spending must be tied to a particular head of legislative power.
Then shadow attorney-general George Brandis was far more circumspect about the constitutionality of the legislation. Despite Brandis’ misgivings, the legislation passed with bipartisan support, and Brandis as attorney-general would be called upon to defend the legislation in Williams’ second challenge.
Williams’ second challenge
Williams brought a fresh challenge against the remedial legislation. He argued that it was wholly invalid, or that it was invalid in its application to the chaplaincy program.
In Williams’ second challenge, the Commonwealth sought to reopen Williams’ first challenge on a variety of grounds, including that it:
… led to considerable inconvenience with no significant corresponding benefits.
However, the High Court rejected the argument, explaining:
Examination of the proposition reveals no greater content than that the Commonwealth parties wish that the decision in Williams (No 1) had been different.
The High Court unanimously re-endorsed its decision in Williams’ 2012 challenge.
No federal power to support the program
The High Court explained that the power in Section 32B of the Financial Management and Accountability Act was not as broad as it first appeared. Instead, the High Court read it as providing power to the Commonwealth to make, vary or administer arrangements or grants only where it is within federal legislative power.
This then required the High Court to consider whether the regulations authorising the chaplaincy program fell within federal power.
The Commonwealth argued that that part of the remedial legislation supporting the payment of funding to the National School Chaplaincy Program was valid because it was connected to the federal power to make laws for “the provision of … benefits to students”. The High Court rejected this argument.
The High Court also rejected the argument that the legislation was connected to the federal power to make laws for “trading corporations”, on the basis that the recipients of the funding would be trading corporations.
The need for a second government response
The High Court’s decision requires an immediate government response in both a narrow and broad sense.
In a narrow sense, if the Commonwealth wants to continue funding the National School Chaplaincy Program – and the budgetary announcement indicates that it does – it will have to find an alternative method of supporting it.
The most obvious way of doing so is to channel the funding through the states. The Constitution makes express provision for the Commonwealth to make grants to the states on any terms and conditions it sees fit. Provided the states are willing to accept the grants and pass them onto the chaplaincy providers, this would be a quick fix for this program.
In a broader sense, the Commonwealth must undertake an urgent audit of all of the programs purportedly authorised by Section 32B. The High Court has now confirmed that any program that has no connection to federal legislative power is invalid. It would be extraordinary for the Commonwealth to ignore this broader proposition from the judgment.
Finally, the High Court expressly left open the question of whether the remedial legislation was wholly invalid because it constituted an impermissible delegation of legislative power. Williams argued primary legislation was required to authorise federal expenditures, and that the delegation of authorisation power to the government in Section 32B was insufficient.
The Commonwealth could take this opportunity to address these arguments. Certainly, a wider move away from the direct funding of programs and towards funding programs through the states would avoid this as a source of possible future invalidity.
Gabrielle Appleby receives funding from the Australian Research Council.